Offer some reasons that the intrinsic value that you might calculate with the methodologies learned might yield a price different than what the stock trades at in the stock market. You can reference any method of valuation models in offering thoughts on why there might be differences between intrinsic and market values.
Offer some reasons that the intrinsic value that you might calculate with the methodologies learned might yield a price different than what the stock trades at in the stock market. You can reference any method of valuation models in offering thoughts on why there might be differences between intrinsic and market values.
Intrinsic value of a stock can be calculated using different methods like DCF (discounted cash flows), dividend discount model etc. Some reasons why intrinsic value of a stock might be different from the price that the stock is trading in the market are:
Intrinsic value is an estimated value of a stock while market value is the price at which stock is currently trading in the market. Thus the market value can be higher than the intrinsic value in which case the stock is deemed to be overvalued and can be lower than the intrinsic value in which case the stock will be deemed to be undervalued.
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